# EUR-Lex - 52013PC0261 - EN

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# 52013PC0261

**Proposal for a COUNCIL IMPLEMENTING REGULATION extending the definitive anti-dumping duty imposed by Council Implementing Regulation (EU) No 990/2011 on imports of bicycles originating in the People's Republic of China by imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia or not /* COM/2013/0261 final - 2013/0135 (NLE) */**

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EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

Grounds for and objectives of the
proposal

This proposal concerns the application of
Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection
against dumped imports from countries not members of the European Community
('the basic Regulation') in the investigation of possible circumvention of the
anti-dumping measures imposed by Council Implementing Regulation (EU) No 990/2011 on
imports of bicycles originating in the People's Republic of China ('PRC') by
imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia,
whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia
or not.

General context This proposal is made in the context of the implementation of the basic Regulation and is the result of an investigation which was carried out in line with the substantive and procedural requirements laid out in the basic Regulation and in particular Article 13 thereof.

Existing provisions in the area of the proposal The measures currently in force were imposed by Council Implementing Regulation (EU) No 990/2011 imposing a definitive anti-dumping duty on imports of bicycles originating in the People’s Republic of China.

Consistency with the other policies and objectives of the Union Not applicable.

2.           RESULTS OF CONSULTATIONS
WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS

Consultation of interested parties

Interested parties concerned by the proceeding have had the possibility to defend their interests during the investigation, in line with the provisions of the basic Regulation.

Collection and use of expertise

There was no need for external expertise.

Impact assessment This proposal is the result of the implementation of the basic Regulation. The basic Regulation does not provide for a general impact assessment but contains an exhaustive list of conditions that have to be assessed.

3.           LEGAL ELEMENTS OF THE
PROPOSAL

Summary of the proposed action The attached proposal for a Council Implementing Regulation is based on the findings of the investigation, which has confirmed that transhipment of bicycles from the PRC and assembly of bicycles using Chinese parts in Indonesia, Malaysia, Sri Lanka and Tunisia is taking place and that all criteria for the establishment of circumvention as set out in Article 13(1) and (2) of the basic Regulation were met. Therefore the anti-dumping measures in force on bicycles originating in the PRC should be extended to imports of the same product consigned from Indonesia, Malaysia, Sri Lanka and Tunisia. It is therefore proposed that the Council adopt the attached proposal to extend the anti-dumping measures on bicycles originating in the PRC to imports of the same product consigned from Indonesia, Malaysia, Sri Lanka and Tunisia. The duty corresponds to the country-wide duty on imports of bicycles from the PRC (48.5%). The duty shall be levied from the date of initiation of the investigation. The relevant Council Regulation should be published in the Official Journal of the European Union no later than 5 June 2013.

Legal basis Council Regulation (EC) No 1225/2009 of 30 November 2009 on protection against dumped imports from countries not members of the European Community and in particular Article 13 thereof.

Subsidiarity principle The proposal falls under the exclusive competence of the Union. The subsidiarity principle therefore does not apply.

Proportionality principle The proposal complies with the proportionality principle for the following reasons:

The form of action is described in the above-mentioned basic Regulation and leaves no scope for national decision.

Indication of how the financial and administrative burden falling upon the Union, national governments, regional and local authorities, economic operators and citizens is minimised and proportionate to the objective of the proposal is not applicable.

Choice of instruments

Proposed instruments: Regulation.

Other means would not be adequate for the following reason: The above-mentioned basic Regulation does not provide for alternative options.

4.           BUDGETARY IMPLICATION

The proposal has no implication for the
Union budget.

2013/0135 (NLE)

Proposal for a

COUNCIL IMPLEMENTING REGULATION

extending the definitive anti-dumping duty
imposed by Council Implementing Regulation (EU) No 990/2011 on imports of
bicycles originating in the People's Republic of China by imports of bicycles
consigned from Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as
originating in Indonesia, Malaysia, Sri Lanka and Tunisia or not

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the
Functioning of the European Union,

Having regard to Council Regulation (EC) No
1225/2009 of 30 November 2009 on protection against dumped imports from
countries not members of the European Community[1]
(‘the basic Regulation’), and in particular Article 13 thereof,

Having regard to the proposal submitted by
the European Commission (‘the Commission’) after having consulted the Advisory
Committee,

Whereas:

1.           PROCEDURE

1.1.        Existing measures

(1)       By
Regulation (EEC) no 2474/93[2] the Council imposed a definitive anti-dumping duty of 30.6% on
imports of bicycles originating in the People's Republic of China ('the PRC'). Following an anti-circumvention investigation in accordance with Article 13 of
the basic Regulation, this duty was extended by Council Regulation (EC) No
71/97[3] to imports of certain bicycles parts originating in the People's
Republic of China. In addition, it was decided to create an 'exemption scheme'
on the basis of Article 13(2) of the anti-dumping basic Regulation. The details
of the scheme were provided for in Commission Regulation (EC) No 88/97[4].

(2)       Following an expiry review
pursuant to Article 11(2) of the basic Regulation, the Council, by Regulation
(EC) No 1524/2000[5],
decided that the above mentioned measures should be maintained.

(3)       Following
an interim review pursuant to Article 11(3) of the basic Regulation, the
Council, by Regulation (EC) No 1095/2005[6],
increased the anti-dumping duty in force to 48,5%.

(4)       In October 2011 following
an expiry review pursuant to Article 11(2) of the basic Regulation, the
Council, by Regulation (EU) No 990/2011[7],
decided that the above mentioned measures should be maintained ('the existing
measures').

(5)       In March 2012 the
Commission announced by a notice published in the Official Journal of the
European Union[8]
the initiation of an interim review of the anti-dumping measures concerning
imports into the Union of bicycles originating in the PRC pursuant to Article
11(3) and 13(4) of the anti-dumping basic Regulation.

(6)       In May 2013 the Council,
by Regulation (EU) No XXX/2013[9][to be filled in during
written procedure by the Council Secretariat], amended Council
Implementing Regulation (EU) No 990/2011 imposing a definitive anti-dumping duty
on imports of bicycles originating in the People's Republic of China following
an interim review pursuant to Article 11(3) of Regulation (EC) No 1225/2009.

(7)       In
April 2012 the Commission announced by a notice published in the Official
Journal of the European Union[10] the
initiation of an anti-subsidy proceeding with regard to imports into the Union
of bicycles originating in the People’s Republic of China pursuant to Article
10 of the Council Regulation (EC) No 597/2009 of 11 June 2009[11].

(8)       In November 2012 the
Commission announced by a notice published in the Official Journal of the
European Union[12]
that the findings in the present investigation may be used in the anti-subsidy
investigation mentioned in recital (7) above.

(9)       In May 2013 the Commission
by Regulation (EU) No xxx/2013[13][to be filled in during written procedure by the Council Secretariat],
terminated the anti-subsidy proceeding mentioned in recital (7) above without
imposing measures.

1.2.        Request

(10)     On 14 August 2012 the
Commission received a request pursuant to Articles 13(3) and 14(5) of the basic
Regulation to investigate the possible circumvention of the anti-dumping
measures imposed on imports of bicycles originating in the PRC and to make
imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka and Tunisia,
whether declared as originating in Indonesia, Malaysia, Sri Lanka and Tunisia
or not, subject to registration.

(11)     The request was lodged by
the European Bicycle Manufacturers Association (EBMA) on behalf of In Cycles –
Montagem e Comercio de Bicicletas, Ldo, SC. EUROSPORT DHS S.A. and MAXCOM Ltd, three Union producers of bicycles.

1.3.        Initiation

(12)     Having determined, after
consulting the Advisory Committee, that sufficient prima facie evidence
existed for the initiation of an investigation pursuant to Articles 13(3) and
14(5) of the basic Regulation, the Commission decided to investigate the
possible circumvention of the anti-dumping measures imposed on imports of
bicycles originating in the PRC and to make imports of bicycles consigned from
Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in
Indonesia, Malaysia, Sri Lanka and Tunisia or not, subject to registration.

(13)     The
investigation was initiated on 25 September 2012 by Commission Regulation (EU)
No 875/2012[14] (‘the initiating Regulation’).

(14)     The prima facie
evidence at the Commission's disposal showed a significant change in the
pattern of trade involving exports from the PRC, Indonesia, Malaysia, Sri Lanka
and Tunisia to the Union following the increase of the anti-dumping duty on
imports of the product concerned by Council Regulation (EC) 1095/2005 mentioned
in recital (3) above. The change in the pattern of trade appeared to have
occurred without sufficient due cause or justification other than the increase
of the duty.

(15)     This change appeared to
stem from the transhipment of bicycles originating in the PRC via Indonesia, Malaysia, Sri Lanka and Tunisia to the Union and from assembly operations in Indonesia, Sri Lanka and Tunisia.

(16)     Furthermore, the evidence
pointed to the fact that the remedial effects of the existing anti-dumping
measures on the product concerned are being undermined both in terms of
quantity and price. Significant volumes of imports of the product under investigation
appeared to have replaced imports of the product concerned originating in the
PRC. In addition, there was sufficient evidence that imports of the product
under investigation were made at prices below the non-injurious price
established in the investigation that led to the existing measures.

(17)     Finally, there was evidence
that the prices of the product under investigation were dumped in relation to
the normal value previously established for the product concerned.

1.4.        Investigation

(18)     The Commission officially
advised the authorities of the PRC, Indonesia, Malaysia, Sri Lanka and Tunisia, the producers/exporters in those countries, the importers in the Union known to be concerned and the Union industry of the initiation of the investigation.

(19)     Exemption
forms were sent to the producers/exporters in Indonesia, Malaysia, Sri Lanka and Tunisia known to the Commission or through the Missions of Indonesia, Malaysia, Sri Lanka and Tunisia to the European Union. Questionnaires were sent to the producers/exporters
in the PRC known to the Commission or through the Mission of the PRC to the
European Union. Questionnaires were also sent to the known unrelated importers
in the Union.

(20)     Interested parties were
given the opportunity to make their views known in writing and to request a
hearing within the time limit set in the initiating Regulation. All parties were informed that non-cooperation
might lead to the application of Article 18 of the basic Regulation and to
findings being based on the facts available.

(21)     Four producers/exporters in Indonesia, one in Malaysia, six in Sri Lanka and two in Tunisia submitted replies to the exemption forms. There was no cooperation from the Chinese producers/exporters.
Three unrelated importers in the Union submitted a questionnaire reply.

(22)     The
Commission carried out the verification visits at the premises of the following
companies:

–
P.T. Insera Sena, Buduran, Sidoarjo, Indonesia,

–
Wijaya Indonesia Makmur Bicycles Industries,
Driyorejo, Gresik, Jawa Timur, Indonesia,

–
P.T. Terang Dunia Internusa, Slipi, Jakarta Barat, Indonesia,

–
P.T. Chin Haur, Tangerang, Indonesia,

–
Tan Lan Venture Corporation Sdn Bhd, Kampar, Perak, Malaysia,

–
Asiabike Industrial Limited, Henamulla, Panadura, Sri Lanka,

–
BSH Ventures Limited, Colombo, Sri Lanka,

–
City Cycle Industries, Colombo, Sri Lanka,

–
Firefox Lanka (Pvt) Ltd, Weliketiya Pamunugama, Sri Lanka,

–
Kelani Cycles Pvt Ltd, Katunayake, Sri Lanka,

–
Samson Bikes (Pvt) Ltd, Colombo, Sri Lanka,

–
Mediterranean United Industries, Bouhajar Monastir, Tunisia,

–
Euro Cycles, Sousse, Tunisia.

1.5.        Reporting period and
investigation period

(23)     The investigation period
covered the period from 1 January 2004 to 31 August 2012 (‘the IP’). Data were
collected for the IP to investigate, inter alia, the alleged change in
the pattern of trade following the increase of the anti-dumping duty in 2005.
More detailed data were collected for the reporting period from 1 September
2011 to 31 August 2012 (‘the RP’) in order to examine the possible undermining
of the remedial effect of the measures in force and existence of dumping.

2.           RESULTS OF THE
INVESTIGATION

2.1.        General considerations

(24)     In accordance with Article
13(1) of the basic Regulation, the assessment of the existence of circumvention
was made by analysing successively whether there was a change in the pattern of
trade between the PRC, the four countries concerned and the Union; if this
change stemmed from a practice, process or work for which there was
insufficient due cause or economic justification other than the imposition of
the duty; if there was evidence of injury or that the remedial effects of the
duty were being undermined in terms of the prices and/or quantities of the
product under investigation; and whether there was evidence of dumping in relation
to the normal values previously established, if necessary in accordance with
the provisions of Article 2 of the basic Regulation.

2.2.        Product concerned and
product under investigation

(25)     The product concerned is
bicycles and other cycles (including delivery tricycles, but excluding
unicycles), not motorised, originating in the People’s Republic of China,
currently falling within CN codes 8712 00 30 and ex 8712 00 70 (‘the product
concerned’).

(26)     The product under
investigation is the same as that defined above but consigned from Indonesia,
Malaysia, Sri Lanka and Tunisia, whether declared as originating in Indonesia,
Malaysia, Sri Lanka and Tunisia or not, currently falling within the same CN
codes as the product concerned ('the product under investigation’).

(27)     The investigation showed
that bicycles, as defined above, exported from the PRC to the Union and those
consigned from Indonesia, Malaysia, Sri Lanka and Tunisia to the Union have the
same basic physical and technical characteristics and have the same uses, and
are therefore to be considered as like products within the meaning of Article
1(4) of the basic Regulation.

2.3.        Degree of cooperation and
determination of the trade volumes

2.3.1.     Indonesia

(28)     The four Indonesian
companies that submitted a request for exemption in accordance with Article
13(4) of the basic Regulation represented 91% of the total imports from Indonesia to the Union during the RP. The overall import volumes from Indonesia were established on
the basis of the data from Comext[15].

(29)     The
data submitted by one company was unverifiable as the company claimed that it
kept no working sheets used to fill in the exemption form. Therefore, the
company was unable to explain and demonstrate how the reported figures were
obtained. Moreover, the data submitted by the company proved to be unreliable
as the reported figures that were tested and recalculated on the basis of the
bookkeeping available at the company's premises were found inaccurate (e.g.
purchases, production volume). The investigation revealed furthermore that the
sales manager of the company was in fact in the same time employed by a Chinese
producer of bicycles which was the main supplier of the raw material (bicycle
parts) of the Indonesian company.

(30)     Therefore, in accordance
with Article 18(4) of the basic Regulation, the company was informed of the
intention to disregard the information submitted by it and was granted a time
limit to provide its comments.

(31)     The
company stated that it was very cooperative by providing all the documents
requested apart from the working sheets which allegedly were not requested
before. However, the working sheets were requested in the pre-verification
letter sent to the company prior to the on-spot verification. Moreover, the company
claimed that the calculation of the production and purchases values was
affected by wrong explanations from a worker and that the checking of the
export transactions was accurate. In this regards, it should be pointed out
that in spite of several explanations from the workers, in the end it was not
possible to reconcile the numbers provided on-spot with the numbers submitted
in the exemption form. As concerns the value of the export sales, the
reconciliation was indeed accurate. Furthermore, during the verification visit
the workers that participated at the verification were not able to explain the
source of the numbers stated in the exemption form neither how the numbers have
been compiled. Moreover, the company confirmed that the sales manager was in parallel
working for a Chinese producer of bicycles.

(32)     Therefore, the information
provided by the company in question had to be disregarded.

(33)     Findings
with regard to this company were therefore based on facts available in
compliance with Article 18 of the basic Regulation.
The other three companies were considered cooperating.

2.3.2.     Malaysia

(34)     The sole Malaysian company that submitted a request for
exemption in accordance with Article 13(4) of the basic Regulation represented
between 20% and 30% of the total imports from Malaysia to the Union during the RP. Total
imports of bicycles from Malaysia into the Union were established on the basis
of the data from Comext. The company was considered
cooperating.

2.3.3.     Sri Lanka

(35)     The
six Sri Lankan companies that submitted a request for exemption in accordance
with Article 13(4) of the basic Regulation represented 69% of the total imports from Sri Lanka to the Union during the RP. The
overall import volumes from Sri Lanka were established on the basis of the data
from Comext.

(36)     One
of the companies withdrew its request for exemption during the investigation on
the grounds that it had stopped the production of bicycles in Sri Lanka. Therefore, data with regard to this
company were disregarded.

(37)     The
cooperation of the second company was found to be insufficient. The data
submitted was unverifiable as the value and volume of parts of Chinese origin
purchased by the company could not be reliably determined. Moreover, the value
and volume of the parts used in the manufacturing process could not be verified
as they were purchased by a third party and only consigned to the company for
assembly.

(38)     Therefore, in accordance
with Article 18(4) of the basic Regulation, the company was informed of the intention
to disregard the information submitted by it and was granted a time limit to
provide its comments. The company did not provide any comments.

(39)     The
cooperation of another company was also considered insufficient. The
information provided could not be verified on-spot as the company withheld
essential information. More specifically, it failed to prepare information
explicitly requested prior to the on-spot verification, such as the working
sheets or the list of its related companies, thus impeding the verification
process. On the other hand, the purchase value of parts of local origin as
reported by the company was found unreliable, notably as the investigation
revealed at least some links between the company and its local supplier of
bicycle parts that were going beyond a normal buyers and sellers relationship
and which could not be clarified by the company.

(40)     In
accordance with Article 18(4) of the basic Regulation, the company was informed
of the intention to disregard the information submitted by it and was granted a
time limit to provide its comments. In response, the company contested the
findings and submitted further evidence and explanations. None of the newly
submitted evidence could have been accepted. Firstly, because it could not have
been verified anymore since provided after the on-spot visit, In most cases the
newly submitted evidence was found to be inconsistent with the explanations and
evidence gathered on spot. As regards the newly submitted explanations, these were
found to be insufficient as they did not address the main outstanding issues,
in particular, the missing clarifications regarding related companies.

(41)     Therefore the information
provided by the company in question had to be disregarded.

(42)     Findings
with regard to this company were therefore based on facts available in
compliance with Article 18 of the basic Regulation.

2.3.4.     Tunisia

(43)     The two Tunisian companies
that submitted a request for exemption in accordance with Article 13(4) of the
basic Regulation represented all imports from Tunisia to the Union during the
RP as reported in Comext. They were considered cooperating.

2.3.5.     The People’s Republic of China

(44)     As mentioned in recital
(21) above, there was no cooperation from any of the Chinese producers/exporters.
Therefore, findings in respect of imports of the product concerned into the
Union, on the one hand, and exports of bicycles from the PRC to Indonesia, Malaysia, Sri Lanka and Tunisia, on the other hand, were based on facts available in
accordance with Article 18(1) of the basic Regulation. With regards to imports
to the Union import data recorded in Comext were used. Chinese national
statistics were used as regards the determination of export volumes from the
PRC to Indonesia, Malaysia, Sri Lanka and Tunisia.

2.4.        Change in the pattern of
trade

2.4.1.     Imports into the Union from the PRC, Indonesia, Malaysia, Sri Lanka and Tunisia

(45)     Imports of the product
concerned from the PRC into the Union decreased by 38.2% since 2005, i.e. after
the increase of the anti-dumping measures in July 2005, and continued
decreasing in the following years. In total, imports from the PRC decreased by
over 80% in the IP.

(46)     At the same time, imports
of the product under investigation from Indonesia into the Union increased from
2005 onwards and more than doubled in 2006 as compared to 2004. Imports
continued increasing, with the exception of 2009, albeit remaining at levels
well above those of 2004. Since 2009, imports increased again continuously up
to the RP. In the RP imports from Indonesia increased by 157% as compared to
2004.

(47)     As concerns the imports of
the product under investigation from Malaysia into the Union, they were
negligible before the increase of the anti-dumping duty in July 2005. In 2005,
they increased significantly (more than two hundred fold) but decreased in 2009
by 46%, followed by another increase of 38% in 2010. Although imports from
Malaysia decreased again in 2011 and during the RP, the import level from
Malaysia during the RP still exceeded by far the import level from 2004 before
the increase of the anti-dumping measures, i.e. 185 158 bicycles as compared to
10 749 pieces in 2004 or by 1 623%.

(48)     The imports of the product
under investigation from Sri Lanka into the Union increased significantly after
the increase of the anti-dumping duties in 2005 and continued increasing in the
following years by almost 500% reaching a peak in 2010. In 2011 and during the
RP the imports from Sri Lanka of the product under investigation decreased, albeit
still exceeding by far the import levels from 2004 before the increase of the
anti-dumping measures, i.e. overall imports from Sri Lanka increased by 282%
between 2004 and the RP.

(49)     Finally, imports of the
product concerned from Tunisia into the Union increased by almost 30% in 2005,
i.e. after the increase of the anti-dumping duties, and by more than 20% in
2006. They more than doubled between 2006 and 2007 reaching a peak in 2007.
Imports during 2008 and 2010 were decreasing, increasing again in 2011 and
finally decreasing slightly during the RP. During the IP imports from Tunisia increased by 200.3%.

(50)     Table 1 below shows import
quantities of bicycles from the PRC, Indonesia, Malaysia, Sri Lanka and Tunisia into the Union from 1 January 2004 to 31 August 2012, i.e. during the IP.

Table 1

(pieces) 2004 || 2005 || 2006 || 2007 || 2008 || 2009 || 2010 || 2011 || 1.9.2011-31.8.2012 (RP)

The PRC ||  2,550,775 ||  1,575,452 ||  995,715 || 986,514 ||  941,522 ||  597,339 ||  627,066 ||  584,303 || 411,642

Index (2004 = 100) || 100 || 61.8 || 39.0 || 38.7 || 36.9 || 23.4 || 24.6 || 22.9 || 16.1

Indonesia || 237,648 || 282,045 || 500,623 || 593,769 || 634,623 || 437,023 || 551,847 || 614,798 || 612,448

Index (2004 = 100) || 100 || 118.7 || 210.7 || 249.9 || 267.0 || 183.9 || 232.2 || 258.7 || 257.7

Malaysia || 10,749 || 229,354 || 497,974 || 475,463 || 360,871 || 193,102 || 266,164 || 177,306 || 185,158

Index (2004 = 100) || 100 ||  2,133.7 ||  4,632.7 ||  4,423.3 ||  3,357.3 ||  1,796.5 ||  2,476.2 ||  1,649.5 ||  1,722.6

Sri Lanka ||  249,491 ||  352,078 ||  534,413 ||  574,153 ||  749,358 ||  1,016,523 ||  1,237,406 ||  975,297 || 953,169

Index (2004 = 100) || 100 ||  141.1 ||  214.2 ||  230.1 ||  300.4 ||  407.4 ||  496.0 ||  390.9 ||  382.0

Tunisia ||  167,137 ||  212,257 ||  251,054 ||  549,848 ||  527,209 ||  529,734 ||  414,488 ||  519,217 || 501,853

Index (2004 = 100) || 100 ||  127.0 ||  150.2 ||  329.0 ||  315.4 ||  316.9 ||  248.0 ||  310.7 ||  300.3

Source: Comext statistics

2.4.2.     Exports from the PRC to Indonesia, Malaysia, Sri Lanka and Tunisia

(51)     Exports of bicycles from
the PRC to Indonesia increased first in 2008 (by 56.2%). Between 2008 and the
RP, imports continued increasing with the exception of 2009. During the IP
exports from the PRC to Indonesia increased in total by 83.8%.

(52)     Exports of bicycles from
the PRC to Malaysia increased in 2005, after the increase of the anti-dumping
measures, by almost 30% and continued increasing until they reached a peak in
2011, i.e. an increase of 110.8% as compared to 2004. In the RP the exports
from the PRC to Malaysia, decreased slightly, but remained at levels largely
exceeding those of 2004. Overall, Chinese exports to Malaysia increased by
99.6% during the IP.

(53)     Exports of bicycles from
the PRC to Sri Lanka also increased following the increase of the anti-dumping
duties in July 2005. They slightly decreased in 2007 but more than doubled in
2010 and 2011 as compared to 2004. Overall, Chinese exports to Sri Lanka increased by 132.5% during the IP.

(54)     Finally exports from the
PRC to Tunisia were negligible before the increase of the anti-dumping duties.
From 2005 on exports to Tunisia increased significantly reaching a peak in 2008
(from 2 534 pieces in 2004 to 389 445 pieces in 2008). Although exports from
the PRC to Tunisia decreased and remained at lower levels after 2008 they still
remained at much higher levels than during 2004. Overall, Chinese exports to Tunisia increased from 2 534 bicycles in 2004 to 170 772 bicycles in the RP.

(55)     Table 2 shows exports of
bicycles from the PRC to Indonesia, Malaysia, Sri Lanka and Tunisia from 1 January 2004 to 31 August 2012, i.e. during the IP.

Table 2

(pieces) 2004 || 2005 || 2006 || 2007 || 2008 || 2009 || 2010 || 2011 || 1.9.2011-31.8.2012 (RP)

Indonesia || 2,128,804 || 1,731,224 || 2,121,019 || 1,906,364 || 3,325,531 || 2,287,374 || 3,644,836 || 3,773,852 || 3,912,882

Index (2004 = 100) || 100 || 81.3 || 99.6 || 89.6 || 156.2 || 107.4 || 171.2 || 177.3 || 183.8

Malaysia || 721,335 || 933,943 || 890,241 || 974,860 || 1,515,886 || 1,111,251 || 1,291,766 || 1,520,276 || 1,440,132

Index (2004 = 100) || 100 ||  129.5 ||  123.4 ||  135.1 ||  210.2 ||  154.1 ||  179.1 ||  210.8 ||  199.6

Sri Lanka || 267,371 || 315,233 || 345,953 || 254,774 || 425,405 || 383,377 || 699,328 || 685,744 || 621,620

Index (2004 = 100) || 100 || 117.9 || 129.4 || 95.3 || 159.1 || 143.4 || 261.6 || 256.5 || 232.5

Tunisia || 2,534 || 7,188 || 37,042 || 175,761 ||  389,445 || 171,332 ||  225,369 ||  204,465 || 170,772

Index (2004 = 100) || 100 ||  283.7 ||  1,461.8 ||  6,936.1 ||  15,368.8 ||  6,761.3 ||  8,893.8 ||  8,068.9 ||  6,739.2

Source: Chinese statistics

2.4.3.     Production volumes

(56)     The companies in Indonesia and Tunisia increased their production between 2009 and the RP, by 54% and 24%
respectively. The Sri Lankan companies however have slightly decreased their
output during the same period.

(57)     Concerning Malaysia, the sole Malaysian company that cooperated started to produce and export bicycles
in 2010. As no other company cooperated, no information could be obtained on
the possible levels of the genuine production of the product under
investigation in this country.

Table 3

Production of bicycles of the cooperating
companies in Indonesia, Sri Lanka and Tunisia

Production volumes in units || 2009 || 2010 || 2011 || RP

Indonesia || 1,217,664 || 1,631,459 || 1,877,067 || 1,877,381

Index || 100 || 134 || 154 || 154

Sri Lanka ||  737,632 ||  886,191 ||  688,059 ||  692,454

Index ||  100 ||  120 ||  93 ||  94

Tunisia || 430,022 || 483,135 || 575,393 ||  532,425

Index || 100 || 112 || 134 || 124

2.5.        Conclusion on the change in
the pattern of trade

(58)     The
overall decrease of the exports from the PRC to the Union and the parallel
increase of exports from Indonesia, Malaysia, Sri Lanka and Tunisia to the
Union and the increase of exports from the PRC to Indonesia, Malaysia, Sri
Lanka and Tunisia after the increase of the anti-dumping measures in July 2005
constitutes a change in the pattern of trade between the countries concerned,
on the one hand, and the Union, on the other hand, within the meaning of
Article 13(1) of the basic Regulation.

2.6.        Nature of the circumvention
practices

(59)     Article 13(1) of the basic
Regulation requires that the change in the pattern of trade stems from a
practice, process or work for which there is insufficient due cause or economic
justification other than the imposition of the duty. The practice, process or
work includes, inter alia, the consignment of the product subject to the
existing measures via third countries and the assembly of parts by an assembly
operation in the Union or a third country. The existence of assembly operations
is determined in accordance with Article 13(2) of the basic Regulation.

2.6.1.     Indonesia

Transhipment

(60)     The exports of the four
initially cooperating Indonesian companies amounted to 91% of the total
Indonesian exports to the Union in the RP.

(61)     For
three out of the four initially cooperating companies, the investigation did
not reveal any transhipment practices.

(62)     As
concerns the fourth company, as stated in recitals (29) to (33) above, application of Article 18 of the basic Regulation was
warranted. The investigation revealed that the company did not own sufficient
equipment to justify the volumes of exports into the Union in the RP and, in
the absence of any other justification, it can be concluded that the company
was involved in circumvention practices via transhipment.

(63)     For the remaining exports
to the Union there was no cooperation as described in recitals (29) to (33) above.

(64)     Therefore, in light of the
change of the pattern of trade concluded in recital (58)above between Indonesia
and the Union within the meaning of Article 13(1) of the basic Regulation, the
findings of one Indonesian company as stated in recital (61) above, and the
fact that not all Indonesian producers/exporters came forward and cooperated
the existence of transhipment of Chinese-origin products via Indonesia is
confirmed.

Assembly operation

(65)     The
sources of raw materials (bicycle parts) and the cost of production were
analysed for each cooperating company to establish whether any assembly
operation in Indonesia is
circumventing the existing measures according to the criteria of Article 13(2)
of the basic Regulation. For three out of the four companies that initially
cooperated the Chinese-origin raw materials (bicycle parts) did not constitute
60% or more of the total value of the parts of the assembled product. It was
not necessary, therefore, to examine whether or not the value added to the
parts brought in, during the assembly operation, was greater than 25% of the
manufacturing cost. Consequently, assembly operations were not established with
regard to these three companies.

(66)     For the fourth company,
Article 18(1) of the basic Regulation was applied as mentioned in recitals (29) to (33) above. Since the company could not provide reliable data, it
could not be established whether it was involved in assembly operations.

(67)     Therefore, the existence of
assembly operations within the meaning of Article 13(2) of the basic Regulation
was not established.

2.6.2.     Malaysia

Transhipment

(68)     The exports of the sole
cooperating Malaysian company amounted to between 20% and 30% of the total
Malaysian exports to the Union in the RP. This company started to produce and
export to the Union the product concerned only at the end of 2011. No
transhipment practices were found with regard to this company. For the
remaining exports to the Union there was no cooperation as made clear in
recital (34) above.

(69)     Therefore, in light of the
change of the pattern of trade concluded in recital (58)between Malaysia and
the Union within the meaning of Article 13(1) of the basic Regulation and the
fact that not all Malaysian producers/exporters came forward and cooperated it
can be concluded that the remaining volumes of exports which are not coming
from this company can be attributed to transhipment practices.

(70)     The existence of
transhipment of Chinese-origin products via Malaysia is therefore confirmed.

Assembly operation

(71)     In case of Malaysia the scope of the investigation was extended to cover other circumvention practices
that were identified in the course of the investigation, i.e. assembly
operations, as provided for in recital (12) to the initiating Regulation.

(72)     The criteria of Article 13(2) of the basic Regulation were
analysed for the sole cooperating company to establish whether any assembly
operation in Malaysia is
circumventing the existing measures. The investigation led to the following
findings.

(73)     The
company started operating in 2010 and therefore after the anti-dumping measures
against the PRC were increased. The company was found to be export oriented
targeting the Union market, as only negligible sales were made on the domestic
market or other third countries. Also, the parts used in production were found
to be sourced primarily from the PRC. The criteria of Article 13(2)(a) of the
basic Regulation were therefore considered to be met.

(74)     In addition, this company
purchased completely knocked down bicycle kits from the PRC, except for three
types of parts. In this case, the Chinese-origin raw material (bicycle parts)
constituted more than 60% of the total value of the parts of the final product.
Furthermore, the value added to the parts brought in during the assembly operation
was not found to be greater than 25% of the manufacturing cost of this company. The criteria of Article 13(2)(b) were therefore met.

(75)     Also,
in accordance with Articles 2(11) and (12) of the basic Regulation, a
comparison of the normal value, as previously established (see recital (98) below),
and the export prices of the company to the Union during the RP, expressed as a
percentage of the CIF price at the Union frontier duty unpaid, showed significant
dumping by the company in question with regard to the imports of the product under
investigation. The comparison was carried out per each type of the product under
investigation exported to the Union in the RP. In addition, it was found that the export prices of this
company were well below the injury elimination level established for the Union
industry in the original investigation. The calculation was done by main
product categories, based on the information available. Thus, the remedial
effects of the duty in force are found undermined in terms of prices. On these
grounds, it was concluded that the criteria of Article 13(2)(c) of the basic
Regulation were met.

(76)     On
this basis the company was found involved in an assembly operation. Therefore,
the existence of assembly operations within the meaning of Article 13(2) of the
basic Regulation in Malaysia is confirmed.

2.6.3.     Sri Lanka

Transhipment

(77)     The exports of the
initially cooperating Sri Lankan companies amounted to 69% of the total Sri
Lankan exports to the Union in the RP. For three out of the six initially
cooperating companies, the investigation did not reveal any transhipment
practices. For the remaining exports there was no cooperation as explained in
recitals (35) to (42) above.

(78)     Therefore, in light of the
change of the pattern of trade concluded in recital (58) between Sri Lanka and
the Union within the meaning of Article 13(1) of the basic Regulation and the
fact that not all Sri Lankan producers/exporters came forward and/or cooperated
it can be concluded that the exports of those producers/exporters can be
attributed to transhipment practices.

(79)     The existence of
transhipment of Chinese-origin products via Sri Lanka is therefore confirmed.

Assembly operation

(80)     The
sources of raw materials (bicycle parts) and the cost of production were
analysed for each cooperating company to establish whether any assembly
operation in Sri Lanka is
circumventing the existing measures according to the criteria of Article 13(2)
of the basic Regulation.

(81)     For
three out of the six companies that initially cooperated the Chinese-origin raw
materials (bicycle parts) did not constitute 60% or more of the total value of
the parts of the assembled product. It was not necessary, therefore, to examine
whether or not the value added to the parts brought in, during the assembly
operation, was greater than 25% of the manufacturing cost. Consequently,
assembly operations were not established with regard to these three companies.

(82)     Article 18(1) of the basic
Regulation was applied to two other companies as explained in recitals (37) to (42) above, while one other company withdrew its cooperation
during the on-spot verification as mentioned in recital (36) above. Therefore, the
existence of assembly operations within the meaning of Article 13(2) of the
basic Regulation was not established.

2.6.4.     Tunisia

Transhipment

(83)     The
exports of the cooperating Tunisian companies covered the total imports from Tunisia to the Union in the RP.

(84)     The verification of the two
cooperating companies did not reveal any transhipment of Chinese-origin
products via Tunisia.

Assembly operation

(85)     The sources of raw
materials (bicycle parts) and the cost of production were analysed for each
cooperating company to establish whether any assembly operation in Tunisia is circumventing the existing measures according to the criteria of Article 13(2)
of the basic Regulation. For one cooperating company the Chinese-origin raw
material (bicycle parts) constituted more than 60% of the total value of the
parts of the assembled product. However, the investigation showed that the
value added to the parts brought in during the assembly operation exceeded 25%
of the manufacturing cost of this company. On this basis the company was found
not to be involved in an assembly operation.

(86)     The criteria of Article
13(2) of the basic Regulation were analysed for the other Tunisian company. The
investigation led to the following findings.

(87)     The company started
operating as of 2006 and therefore after the anti-dumping measures against the
PRC were increased. The company was found to be export oriented and targeting
the Union market, as only negligible sales were made on the domestic market or
other third countries. Also, the parts used in production were found to be
sourced primarily from the PRC. Therefore, it is considered that the criteria
of Article 13(2)(a) of the basic Regulation were met.

(88)     Also, the company in
question was found to have a Chinese manufacturer of bicycles as its majority
shareholder.

(89)     Moreover, the company
purchased all parts from the PRC and therefore the Chinese-origin raw material
(bicycle parts) constituted more than 60% of the total value of the parts of
the final product. Furthermore, the investigation revealed that the sole
supplier of the services and of the Chinese parts was related to the Chinese
majority shareholder of the company in question. The added value of the parts
brought in during the assembly operations of the company did not exceed 25% of
the manufacturing cost of this company either. On this
basis the criteria of Article 13(2)(b) of the basic Regulation were
therefore considered to be met.

(90)     In addition, the verification
revealed a large number of mistakes in the list of exports to the Union in the RP and, therefore, a new file was constructed based on the sampled sales
invoices covering around 25% of the total exports to the Union market.
Consequently, as provided by Article 2(11) and (12) of the basic Regulation, in
the absence of detailed information regarding the exports transactions of the
respective company to the Union, the comparison between the normal value and
the export price was made on the basis of the weighted average normal value previously
established (see recital (98) below) to a weighted average export price of this
company to the Union. The dumping margin expressed as a percentage of the CIF
Union frontier value was found to be significant. In addition, it was found
that the export prices of this company were on average well below injury
elimination level established for the Union industry in the original
investigation. The calculation was done on a weighted average basis. Thus, the
remedial effects of the duty in force are found undermined in terms of prices. Therefore,
it was concluded that the criteria of Article 13(2)(c) of the basic Regulation were
met. On this basis the company was found involved in an assembly operation.

(91)     Therefore, the existence of
assembly operations in Tunisia within the meaning of Article 13(2) of the basic
Regulation is confirmed.

2.7.        Insufficient due cause or
economic justification other than the imposition of the anti-dumping duty

(92)     The investigation did not
bring to light any due cause or economic justification for the transhipment and
assembly operations other than the avoidance of the existing measures on the
product concerned. No elements were found, other than the duty, which could be
considered as a compensation for the costs of transhipment and assembly
operations in particular regarding transport and reloading of bicycles
originating in the PRC via Indonesia, Malaysia, Sri Lanka and Tunisia.

2.8.        Undermining of the remedial
effect of the anti-dumping duty

(93)     For the assessment of
whether the imported products had, in terms of quantities and prices,
undermined the remedial effects of the existing measures on imports of the
product concerned from the PRC, Comext data was used as the best available data
concerning quantities and prices of exports by the initially cooperating producers/exporters
where Article 18 of the basic Regulation was applied and by non-cooperating
companies. Where applicable, for the cooperating companies found to be involved
in circumvention practices, their reported quantities and prices of exports
were used. The export prices so determined were compared to the injury
elimination level for Union producers last established, i.e. in the interim
review concluded in 2005, mentioned in recital (3) above.

(94)     The comparison of the
injury elimination level as established in the interim review in 2005 and the
weighted average export price during the RP of the current investigation showed
significant underselling for each of the four countries concerned.

(95)     The increase of imports
from Indonesia, Malaysia, Sri Lanka and Tunisia to the Union was considered
significant in terms of quantities as discussed in section 2.4.1 above.

(96)     It was therefore concluded
that the existing measures are being undermined in terms of quantities and
prices.

2.9.        Evidence of dumping

(97)     Finally, in accordance with
Article 13(1) of the basic Regulation it was examined whether there was
evidence of dumping in relation to the normal value previously established for
the product concerned.

(98)     In
the interim review concluded in 2005, mentioned in recital (3) above, normal
value was established on the basis of prices in Mexico, which in that
investigation was found to be an appropriate market economy analogue country
for the PRC ('normal value previously established').

2.9.1.     Indonesia

(99)     A significant part of
Indonesian exports were found to be genuine Indonesian production exported by
three Indonesian companies that were found not to be involved in circumventing
practices as stated in recitals (61) and (65)
above. For this reason, in order to establish the export prices from Indonesia which are affected by circumvention practices, only the exports of the
non-cooperating producers/exporters were considered. To this end, resort was
made to the best facts available and export prices were established on the
basis of the average export price of bicycles from Indonesia to the Union during the RP as reported in Comext.

(100)   For the purpose of a fair
comparison between the normal value and the export price, due allowance, in the
form of adjustments, was made for differences which affect prices and price
comparability in accordance with Article 2(10) of the basic Regulation.
Accordingly, adjustments were made for differences in transport, insurance and
packing costs submitted by the Union industry in its request for the current
investigation.

(101)   In accordance with Article
2(11) and 2(12) of the basic Regulation, dumping was calculated by comparing
the weighted average normal value as previously established and the
corresponding weighted average export prices of Indonesia during the RP,
expressed as a percentage of the CIF price at the Union frontier duty unpaid.

(102)   The comparison of the
weighted average normal value and the weighted average export price as
established showed dumping.

2.9.2.     Malaysia

(103)   Due to the low cooperation
by the producers of the product under investigation in Malaysia, the export
price from Malaysia had to be based on facts available, i.e. on the
average export price of bicycles during the RP as reported in Comext.

(104)   For the purpose of a fair
comparison between the normal value and the export price, due allowance, in the
form of adjustments, was made for differences which affect prices and price
comparability in accordance with Article 2(10) of the basic Regulation.
Accordingly, adjustments were made for differences in transport, insurance and
packing costs. Given that the cooperation was low, the relevant adjustments
were based on the information submitted by the Union industry in its request
for the current investigation.

(105)   In accordance with Article
2(11) and 2(12) of the basic Regulation, dumping was calculated by comparing
the weighted average normal value as previously established and the
corresponding weighted average export prices of Malaysia during the RP,
expressed as a percentage of the CIF price at the Union frontier duty unpaid.

(106)   The comparison of the
weighted average normal value and the weighted average export price as
established showed dumping.

2.9.3.     Sri Lanka

(107)   Since the cooperation from
Sri Lanka was low, the export price was established on the basis of facts
available, i.e. on the average export price of bicycles during the RP as
reported in Comext which was cross checked with the available export data from
the companies not involved in circumvention practices.

(108)   For the purpose of a fair
comparison between the normal value and the export price, due allowance, in the
form of adjustments, was made for differences which affect prices and price
comparability in accordance with Article 2(10) of the basic Regulation.
Accordingly, and given the absence of any other information available,
adjustments were made for differences in transport, insurance and packing costs
based on the information submitted by the Union industry in its request for the
current investigation.

(109)   In accordance with Article
2(11) and 2(12) of the basic Regulation, dumping was calculated by comparing
the weighted average normal value as previously established and the
corresponding weighted average export prices of Sri Lanka during the RP,
expressed as a percentage of the CIF price at the Union frontier duty unpaid.

(110)   The comparison of the
weighted average normal value and the weighted average export price as
established showed dumping.

2.9.4.     Tunisia

(111)   The export price was
established on the basis of the average export price of bicycles during the RP
as reported in Comext which was cross checked with the export data from the
company not involved in circumvention practices.

(112)   For the purpose of a fair
comparison between the normal value and the export price, due allowance, in the
form of adjustments, was made for differences which affect prices and price
comparability in accordance with Article 2(10) of the basic Regulation.
Accordingly, adjustments were made for differences in transport, insurance and
packing costs based on information submitted by the Union industry in its
request for the current investigation.

(113)   In accordance with Article
2(11) and 2(12) of the basic Regulation, dumping was calculated by comparing
the weighted average normal value as previously established and the
corresponding weighted average export prices of Tunisia during the RP,
expressed as a percentage of the CIF price at the Union frontier duty unpaid.

(114)   The comparison of the
weighted average normal value and the weighted average export price as
established showed dumping.

3.           MEASURES

(115)   Given the above, it can be
concluded that the definitive anti-dumping duty imposed on imports of bicycles
originating in the PRC was circumvented by transhipment via Indonesia,
Malaysia, Sri Lanka and assembly operations via Malaysia and Tunisia within the
meaning of Article 13 of the basic Regulation.

(116)   In accordance with the first
sentence of Article 13(1) of the basic Regulation, the existing measures on
imports of the product concerned originating in the PRC, should therefore be
extended to imports of the same product consigned from Indonesia, Malaysia, Sri
Lanka and Tunisia whether declared as originating in Indonesia, Malaysia, Sri
Lanka and Tunisia or not.

(117)   The measures to be extended
should be the ones currently established in Article 1(2) of Regulation (EC) No
990/2011, which are a definitive anti-dumping duty of 48.5% applicable to the
net, free-at-Union-frontier price, before customs duty.

(118)   In accordance with Articles
13(3) and 14(5) of the basic Regulation, which provides that any extended
measure should apply to imports which entered the Union under registration
imposed by the initiating Regulation, duties should be collected on those
registered imports of bicycles consigned from Indonesia, Malaysia, Sri Lanka
and Tunisia.

4.           REQUESTS FOR EXEMPTION

4.1.        Indonesia

(119)   The four companies in Indonesia that requested an exemption from the possible extended measures in accordance
with Article 13(4) of the basic Regulation submitted a reply to the exemption
form.

(120)   As
stated in recitals (29) to (33)
above, application of Art 18 was warranted for one company. Therefore, in view
of the findings with regard to the change in the pattern of trade and
transhipment as set out in recital (58) above, the exemption cannot be granted
to this company.

(121)   The other three cooperating
companies in Indonesia that requested an exemption from the possible extended
measures in accordance with Article 13(4) of the basic Regulation were not
found to be engaged in the circumvention practices subject to this
investigation as stated in recital (65) above. Furthermore, these producers
could demonstrate that they are not related to any of the producers/exporters
engaged in circumvention practices nor to any of the Chinese
producers/exporters of bicycles. Therefore, an exemption from the extended
measures could be granted to these three companies.

4.2.        Malaysia

(122)   One company in Malaysia that
requested an exemption from the possible extended measures in accordance with
Article 13(4) of the basic Regulation submitted a reply to the exemption form.

(123)   As stated in recital (72) to
(76) above, the company was found to be
involved in circumvention practices. Therefore, in view of the findings with
regard to the change in the pattern of trade and transhipment as set out in
recital (58) above, an exemption cannot be granted to this company.

4.3.        Sri Lanka

(124)   The six companies in Sri Lanka
that requested an exemption from the possible extended measures in accordance
with Article 13(4) of the basic Regulation submitted replies to the exemption
form.

(125)   As
stated in recital (36) above, one
of the companies withdrew its request for exemption during the investigation
and therefore, in view of the findings with regard to the change in the pattern
of trade and transhipment as set out in recital (58) above, an exemption cannot
be granted to this company.

(126)   For
other two companies application of Article 18 of the basic Regulation was
warranted as stated in recitals (36) to (42) above and therefore, in view of
the findings with regard to the change in the pattern of trade and transhipment
as set out in recital (58) above, an exemption cannot be granted to these
companies.

(127)   The other three cooperating companies in Sri Lanka requesting an
exemption from the possible extended measures in accordance with Article 13(4)
of the basic Regulation were found not to be engaged in the circumvention
practices subject to this investigation as stated in recitals (80) and (81) above.
Furthermore, these producers could demonstrate that they are not related to any
of the companies found to circumvent nor to any of the Chinese
producers/exporters of bicycles. Therefore, an exemption from the extended
measures could be granted to these companies.

4.4.        Tunisia

(128)   The two companies in Tunisia
that requested an exemption from the possible extended measures in accordance
with Article 13(4) of the basic Regulation submitted replies to the exemption
form.

(129)   One company was found not to
be engaged in the circumvention practices subject to this investigation.
Furthermore, this producer could demonstrate that it is not related to any of
the companies found to circumvent nor to any of the Chinese producers/exporters
of bicycles. Therefore, an exemption from the extended measures could be
granted to this company.

(130)   As stated in recital (89) above,
the second company was found to be involved in circumvention practices. Therefore,
in view of the findings with regard to the change in the pattern of trade and
transhipment as set out in recital (58) above, an exemption cannot be granted.

4.5.        Special measures

(131)   It is considered that
special measures are needed in this case in order to ensure the proper
application of such exemptions. These special measures are the requirement of
the presentation to the customs authorities of the Member States of a valid
commercial invoice, which shall conform to the requirements set out in the
Annex to this Regulation. Imports not accompanied by such an invoice shall be
made subject to the extended anti-dumping duty.

4.6.        Newcomers

(132)   Without prejudice to Article
11(3) of the basic Regulation, other producers/exporters in Indonesia,
Malaysia, Sri Lanka and Tunisia which did not come forward in this proceeding
and did not export the product under investigation to the Union in the RP and
which consider lodging a request for an exemption from the extended
anti-dumping duty pursuant to Articles 11(4) and 13(4) of the basic Regulation
will be required to complete a questionnaire in order to enable the Commission
to determine whether an exemption may be warranted. Such an exemption may be
granted after the assessment of the market situation of the product under
investigation, production capacity and capacity utilisation, procurement and
sales and the likelihood of a continuation of practices for which there is
insufficient due cause or economic justification and the evidence of dumping.
The Commission would normally also carry out an on-spot verification visit. The
request should be addressed to the Commission forthwith, with all relevant
information, in particular any modification in the company’s activities linked
to the production and sales.

(133)   Where an exemption is
warranted, the extended measures in force shall be amended accordingly.
Subsequently, any exemption granted will be monitored to ensure compliance with
the conditions set therein.

5.           DISCLOSURE

(134)   All interested parties were
informed of the essential facts and considerations leading to the above
conclusions and were invited to comment.

(135)   One Indonesian company reiterated
its claims mentioned in recital (31) above without bringing any new substantiated
evidence. In this regard, as mentioned in recital (29) above, the data
submitted by the company was unverifiable as no working files substantiating
the figures provided in the exemption form were kept by the company. Moreover,
the reported figures that were tested and recalculated on the basis of the
bookkeeping available at the company's premises i.e. purchases and production
volume, were found inaccurate. Therefore, these claims are rejected.

(136)   One Malaysian company argued
that the fact that the weight of the Chinese origin parts in the manufacturing
cost of the bicycles was only slightly above the 60% threshold should not lead
the Commission to reject its exemption request. In addition, the company
submitted certain invoices for purchasing of parts which allegedly were wrongly
reported as originating from the PRC when in fact they were from Indonesia.

(137)   In this respect it should be
noted that the thresholds set in Article (13)(2)(b) of the basic Regulation are
very clear and, therefore, it is not relevant by how much the weight of the
Chinese origin parts in the manufacturing cost of the bicycles exceeds the 60%
threshold but that the Chinese origin parts should represent less than 60% in
the manufacturing cost of the bicycles. Moreover, these invoices could not be
traced back in the list of purchases provided by the company and, in addition,
the value of the invoices submitted were not material as to change the original
assessment of the Commission. Therefore, these claims are rejected.

(138)   In addition, the company in
question argued that there is no sufficient legal basis for the denial of the
company's request for exemption as the conclusions reached are based on calculations
without taking due account of the individual situation of the company in question.
In response to this claim the company received further explanations reflecting
the analysis in recitals (72) to (75) above.

(139)   In addition, the company
claimed that the increase of imports of the product under investigation by the
company in question coincides with the relaxation of the Generalised System of
Preferences for Malaysia and therefore the increase in company's exports into
the Union in 2010 had no economic justification in the increase of the
anti-dumping measures imposed against the PRC. In response to this argument it
was considered that while the relaxation of the Generalised System of
Preferences rules could have contributed to the company's motivation to export
to the Union, it does not contradict the finding that the company started its
operation after the anti-dumping duties against the PRC were increased and that
it sourced the parts mainly from the PRC (see recital (73) above). Therefore,
the argument of the party was rejected.

(140)   The same company also
claimed that the reported data concerning the values of purchased and consumed
bicycle parts were not duly verified as no distinction between purchased and
consumed parts was made. In this respect it is noted that based on the figures
reported by the company, the values of purchased and consumed parts were found
to be identical. In addition, the reported values of purchased parts in 2011
corresponded to the value of consumed parts reported in the annual report of
the company for 2011. The figures concerning purchased and consumed parts
reported for RP and 2010 were accepted as declared by the company. Therefore,
the argument was rejected.

(141)   The company in question
submitted further cost breakdowns per product model demonstrating its alleged
compliance with the requirement that the parts sourced from the PRC shall not
exceed 60% of the total value of the parts of the assembled product. This
information contradicted the cost breakdowns per model collected and verified
for selected models on spot for which the failure of the company to comply with
the 60% threshold was confirmed. The new information submitted by the company
in this respect was not backed up by any evidence and, in essence, contradicted
verified information. For this reason the information was disregarded.

(142)   Further, the company claimed
that it acted in good faith as relying on its alleged compliance with
Commission Regulation (EC) No 1063/2010[16]
laying down the applicable rules of origin. In this context it is noted that the
purpose of the anti-circumvention investigation is not to verify the compliance
with the applicable rules of origin. Such verification was not carried out in
the context of the current anti-circumvention investigation and therefore the
alleged compliance with the rules of origin cannot be in this case confirmed. For
this reasons, the alleged compliance with the rules of origin in this case does
not exclude in any way the possibility of circumvention as defined in Article
13(2) of the basic Regulation[17].
Against this background, the argument is therefore rejected.

(143)   Finally, the company claimed
that the dumping margin calculation should have been carried out based on the
company specific data. This request was accepted as reflected in recital (75)
above and the company was informed accordingly.

(144)   A company from Sri Lanka disputed the relevance of the documents requested during the verification visit and
therefore argued that its exemption request should not be rejected. In this
respect it should be noted that the documents showing the origin of the parts
used in the assembly of the bicycles exported to the Union have significant
importance for the assessment of compliance with the conditions of Article
13(2)(b). Also, as mentioned in recital (37) above, the data submitted by the
company was unverifiable. In addition, the company admitted on spot that the
parts purchased from the PRC were actually not recorded in its accounts and
consequently the compliance with the criteria set out in Article 13(2) of the
basic Regulation could not have been determined. Therefore, the claims are
rejected.

(145)   Another company from Sri
Lanka claimed that had it known that the exports to the Union from Sri Lanka
could be subject to the anti-dumping duty as extended to Sri Lanka as from the
initiation of the investigation, it would have not withdrawn its request for
exemption. However, it is underlined that, at the time of the withdrawal of its
request for exemption, the company is considered aware of the possible
application of the anti-dumping duty as extended as from the date of the
registration of imports from Sri Lanka to the Union, i.e. the initiation of the
anti-circumvention investigation. The company has been informed of this
consequence in three instances, through recital (20) of the initiating Regulation,
during a hearing at the beginning of the investigation and during the on-spot
visit. Therefore, the claim could not be accepted.

(146)   Another company from Sri
Lanka submitted new information that it should have submitted before the
verification visit and due to the advanced stage of the investigation that information
could not be verified anymore. Furthermore, the company argued that it had
submitted all the information required.

(147)   As mentioned in recitals (39)
and (40) the company did not submit all the information requested in order to
be verified on-spot. In particular, the purchase value of parts of local origin
as reported by the company was found unreliable. As a result, the compliance
with the criteria set out in Article 13(2) of the basic Regulation could not
have been determined.

(148)   In addition, the company
claimed irregularities concerning the on-spot visit in respect of its length
and language issues. In this regard, it should be noted that the company was
recently set up and therefore only one day of verification was scheduled. The
verification was carried out during a full working day. At the end of the
verification, the company did not ask to submit any additional information that
was not able to provide during the verification.

(149)   Furthermore, before the on-spot
verification the company was informed that the verification will be carried out
in English and the party has not raised any objections. Moreover, the
Commission was accompanied by an interpreter during the on-spot verification to
facilitate language communication problems, if any. In addition, it is
highlighted that most of the documents submitted by the company during the
verification visit were actually in English, including the accounting related
documents.

(150)   In view of the above, all the
claims of the company are rejected.

HAS ADOPTED THIS REGULATION:

Article 1

1.           In light of the purpose of
this Regulation, the definitive anti-dumping duty applicable to ‘all other
companies’ imposed by Article 1(2) of Implementing Regulation (EU) No 990/2011
on imports of bicycles and other cycles (including delivery tricycles, but
excluding unicycles), not motorised, originating in the People’s Republic of
China, is hereby extended to imports of bicycles and other cycles (including
delivery tricycles, but excluding unicycles), not motorised, consigned from
Indonesia, Malaysia, Sri Lanka and Tunisia whether declared as originating in
Indonesia, Malaysia, Sri Lanka and Tunisia or not, currently falling within CN
codes ex 8712 00 30 and ex 8712 00 70 (TARIC code 8712 00 30 10 and 8712 00 70
91) with the exception of those produced by the companies listed below:

Country || Company || TARIC additional code

Indonesia || P.T. Insera Sena, 393 Jawa Street, Buduran, Sidoarjo 61252, Indonesia || B765

|| PT Wijaya Indonesia Makmur Bicycle Industries (Wim Cycle), Raya Bambe KM. 20, Driyorejo, Gresik 61177, Jawa Timur Indonesia || B766

|| P.T. Terang Dunia Internusa, (United Bike), Jl. Anggrek Neli Murni 114 Slipi, 11480, Jakarta Barat, Indonesia || B767

Sri Lanka || Asiabike Industrial Limited, No 114, Galle Road, Henamulla, Panadura, Sri Lanka || B768

|| BSH Ventures (Private) Limited, No. 84, Campbell Place, Colombo-10, Sri Lanka || B769

|| Samson Bikes (Pvt) Ltd., No 110, Kumaran Rathnam Road, Colombo 02, Sri Lanka || B770

Tunisia || Euro Cycles SA, Zone Industrielle Kelaa Kebira, 4060, Sousse, Tunisia || B771

2.           The application of
exemptions granted to the companies specifically mentioned in paragraph 1 of
this Article or authorised by the Commission in accordance with Article 2(2) of
this Regulation shall be conditional upon presentation to the customs
authorities of the Member States of a valid commercial invoice, which shall
conform to the requirements set out in the Annex to this Regulation. If no such
invoice is presented, the anti-dumping duty as imposed by paragraph 1 of this
Article shall apply.

3.           The duty extended by
paragraph 1 of this Article shall be collected on imports consigned from
Indonesia, Malaysia, Sri Lanka and Tunisia, whether declared as originating in
Indonesia, Malaysia Sri Lanka and Tunisia or not, registered in accordance with
Article 2 of Regulation (EU) No 875/2012 and Articles 13(3) and 14(5) of
Regulation (EC) No 1225/2009 with the exception of those produced by the
companies listed in paragraph 1.

4.           Unless otherwise
specified, the provisions in force concerning customs duties shall apply.

Article 2

1.           Requests for exemption
from the duty extended by Article 1 shall be made in writing in one of the
official languages of the European Union and must be signed by a person
authorised to represent the entity requesting the exemption. The request must
be sent to the following address:

European Commission
Directorate-General for Trade
Directorate H
Office: N-105 08/20
1049 Brussels

Belgium
Fax (32 2) 295 65 05

2.           In accordance with Article
13(4) of Regulation (EC) No 1225/2009 the Commission, after consulting the
Advisory Committee, may authorise, by decision, the exemption of imports from
companies which do not circumvent the anti-dumping measures imposed by
Regulation (EU) No 990/2011, from the duty extended by Article 1 of this
Regulation.

Article 3

Customs authorities are hereby directed to
discontinue the registration of imports, established in accordance with Article
2 of Regulation (EU) No 875/2012.

Article 4

This Regulation shall enter into force on
the day following that of its publication in the Official Journal of the
European Union.

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Brussels,

For
the Council

The
President

ANNEX

A declaration signed by an official of the
entity issuing the commercial invoice, in the following format, must appear on
the valid commercial invoice referred to in Article 1(2):

(1) The name and function of the official
of the entity issuing the commercial invoice;

(2) The following declaration: ‘I, the
undersigned, certify that the (volume) of (product concerned) sold for export
to the European Union covered by this invoice was manufactured by (company name
and address) (TARIC additional code) in (country concerned). I declare that the
information provided in this invoice is complete and correct’;

(3) Date and signature.

[1]               OJ L 343, 22.12.2009, p. 51.

[2]               OJ L 228, 9.9.1993, p. 1

[3]               OJ L 16, 18.1.1997, p. 55

[4]               OJ L 17, 21.1.1997, p. 17

[5]               OJ L 175, 14.7.2000, p. 39

[6]               OJ L 183, 14.7.2005, p. 1

[7]               OJ L 261, 6.10.2011, p. 2

[8]               OJ C 71, 9.3.2012, p. 10

[9]               OJ L XX, [date], p.x

[10]             OJ C 122, 27.4.2012, p. 9

[11]             OJ L 188, 18.7.2009, p. 93

[12]             OJ C 346, 14.11.2012, p.7

[13]             OJ L XXX, date, page

[14]             OJ L 258, 26.9.2012, p. 21.

[15]             Comext is a database on foreign trade statistics
managed by Eurostat

[16]             OJ L 307, 23.11.2010, p. 1.

[17]             See also previous cases, e.g. recital (48) of Council
Regulation (EC) No 388/2008 (OJ L 117, 1.5.2008. p. 1).